Stipulated: The case of the Weinstein Company’s collapse and ongoing drama about whether it will be sold or file bankruptcy is unique in the annals of show business failures.

The sexual misconduct scandal that brought down the outfit’s co-founder Harvey Weinstein and quickly made its very name toxic is unprecedented. The unusually discussed-in-public purchase bid by a group headed by former Obama Administration official Maria Contreras-Sweet and L.A.-based investor Ron Burkle has been on, off, on and most recently off again. New York Attorney General Eric Schneiderman threw a wrench into the proceedings when he filed a civil rights lawsuit against Harvey and his brother, company co-chairman Bob Weinstein, last month.

FILE – In this April 7, 2014 file photo, Maria Contreras-Sweet speaks during a ceremonial swearing in as Administrator of the Small Business Administration in the South Court Auditorium on the White House complex in Washington. (AP Photo/Evan Vucci, File)

“If you said it would have happened a year ago, I’d have said it never would have happened,” noted Chuck Tatelbaum, chair cf the Ft. Lauderdale law firm Tripp Scott’s Creditors’ Rights and Bankruptcy Practice Group and a 52-year veteran in the field. “Businesses have been brought down by things that happened, not because of the actions of the CEOs and stuff. This is the first time in my memory that this has happened.”

So, all that’s weird. But the fact that the Weinstein Company was generally considered to be running on fumes for a few years before the Harvey allegations broke indicate that, for all the substantial success the brothers had with their eponymous Oscar factory and their even mightier previous business Miramax Films, their current operation was doomed to suffer the fate most independent film companies have for nearly a century.

“My observation is it’s extremely similar” to other failed companies’ woes, excepting its boss’ requests for massages and worse during “business” meetings, Tatelbaum said. “It’s just the precipitating factor was different.”

Armloads of Oscars and the occasional — or even several successive — box-office phenomenons have rarely been enough to sustain indie operations for a long time in the cash-burning world of making and distributing motion pictures. The major studios have traditionally been better capitalized and diversified to weather the ups and downs of movie popularity, which is almost always a gamble no matter how commercial the elements of any particular film seems on paper.

Indeed, billionaire Burkle was a major investor in Relativity Media, a bigger-than-Weinsteins, free-standing movie company that went into Chapter 11 in 2015. New Line Cinema may have made all the money in Middle-earth with its “Lord of the Rings” trilogy, but that didn’t prevent the once independent studio from being absorbed into a (still quite successful) producing entity for Warner Bros. a few years later. And for the majority of indie outfits that don’t take risks on big blockbusters but stick to buying more arthouse fare, staying alive or not getting bought out by a major is even harder.

“I think it’s largely just that this has always been a difficult business, with too many players competing for a limited market,” observed Geoff King, author of the seminal 2005 book “American Independent Cinema” and Professor of Film Studies at London’s Brunel University. “That kind of competition tends to lead to pressure for more spending on marketing, which increases the costs all round and seems to be one dynamic that leads to regular problems.”

Actor Charlie Chaplin is seen in the film “The Gold Rush,” 1925. (AP Photo)

The independent studio concept began, ironically, with four of the most powerful talents in Hollywood. Comedy king Charlie Chaplin, America’s (actually Canadian) Sweetheart Mary Pickford, her swashbuckling husband Douglas Fairbanks and granddaddy of all directors D.W. Griffith formed United Artists in 1919 to provide themselves with more creative freedom than they felt the major studios at the time — now, also, all gone — gave them.

Almost from the start, though, UA had trouble meeting its goals and keeping it together business-wise, although it managed to reinvent itself as a more-or-less going concern for decades. Through the years, UA did indeed live up to the founders’ intentions, backing such classic films as “The African Queen,” “Some Like It Hot,” “A Hard Day’s Night,” “Midnight Cowboy,” “One Flew Over the Cuckoo’s Nest,” “Rocky,” “Annie Hall” and “Raging Bull.” They brought James Bond, Clint Eastwood’s Spaghetti Westerns and “Last Tango in Paris” to America.

But the company was brought down when Oscar-winning director Michael Cimino’s “Heaven’s Gate” went way over budget and barely registered at the box-office. In 1981 Transamerica, the conglomerate that by then owned UA, sold off the film company to MGM, itself a shadow of its Hollywood Golden Age glory. The UA label sort of endured after that, but hardly as an independent.

“I think it’s largely just that this has always been a difficult business, with too many players competing for a limited market.”

— Geoff King, professor of Film Studies at London’s Brunel University

Most successful mid-century indies such as American International and the still-going Roger Corman’s numerous companies thrived by mainly making exploitation films aimed at teenagers, but morphed or were gone by the time a few generations grew up. In the 1980s, some like the De Laurentiis Entertainment Group and the mostly crap merchants but occasionally artistic Cannon Films believed that the new home video market would prevent them from going broke. They were mistaken.

The Weinstein brothers formed Miramax, named after their parents, in 1979. It took about a decade to hit their winning formula of grabbing buzzy, edgy festival hits (“sex, lies, and videotape,” “Reservoir Dogs,” “The Crying Game”) and classy Oscar bait from the English-speaking world (“My Left Foot,” “The Piano”).

John Travolta and Samuel L. Jackson in a scene from Pulp Fiction. (Daily News file photo) 1994 Miramax film

The Walt Disney Company was so impressed with Miramax’s performance that it bought the company in 1993 – but unlike with other indie absorptions, The Mouse let the Weinsteins keep running it their way and gave them huge budgets to continue making and acquiring commercial, critical and awards-guzzling hits like “Pulp Fiction,” “The English Patient,” “Good Will Hunting” and “Shakespeare in Love.” Until the Disney brass just couldn’t take Harvey anymore, and in 2005 gave him and Bob enough money to go away and start the company that’s now in so much trouble.

Others tried to copy Miramax’s formula, but couldn’t for long. October Films and Good Machine, for example, were later merged into Universal’s arthouse arm Focus Features. All the major studios tried to match Disney by opening or buying their own arthouse divisions, just to realize the returns weren’t worth the efforts and expenditures. Of those, only Focus, Sony Classics and Fox Searchlight remain today – and though Disney boss Bob Iger told a shareholders meeting Thursday that he doesn’t plan to mess with the latter, which just dominated the Oscars with “The Shape of Water” and “Three Billboards Outside Ebbing, Missouri,” few expect that will be the case after Disney absorbs Fox’s filmed entertainment assets.

A few indies continue to thrive after many years, though, by sticking to very specific survival tactics. Lionsgate, which can trace its corporate origins back 56 years to a small Canadian indie, has done better than some majors in recent years via heavy reliance on YA franchises (“Twilight,” “The Hunger Games”), horror (“Saw”) and Tyler Perry. Roadside Attractions has survived for 15 years by keeping its in-house ambitions modest, selling 45 percent of itself to Lionsgate and sharing distribution of some prestige productions, like 2016’s “Manchester by the Sea,” with deep-pocketed, billionaire-backed companies like Amazon Studios.

“Moonlight” Best Supporting Actor Oscar-winner Mahershala Ali.

Getty File

And despite the general odds, indie film companies keep coming along. For every shaky operation like Open Road, which despite its Best Picture Oscar for “Spotlight” a few years back was sold to a new owner in 2017, other young companies like A24 (“Moonlight,” “Lady Bird”) are doing fine – for now.

“It’s very hard to predict,” King says of who will survive. “It’s probably a safe bet to say that, at any moment when there’s a group of such hot new indies, far from all of them will last very long — sadly. Everyone’s trying to find the best way to harness the limited market for indie films at the moment, with lots of new initiatives relating to online sales and the like, but much uncertainty about how exactly to make this work on a stable, long term.”

As for the Weinstein Company’s fate, attorney Tatelbaum wouldn’t be surprised if the Contreras-Sweet group makes another try for its assets at a Chapter 11 auction that would free them or another purchaser of claims and liens against the house Harvey burnt down.

But the bankruptcy lawyer has words of caution for any new owner of a small movie company.

“From everything I know, the film business is totally different than anything else,” Taelbaum said. “You’re dealing with a fickle population, that’s just my outsider’s view. What’s in’s in and it’s out tomorrow, and it has nothing to do with the quality of the presentation.”

Bob Straus has been covering film at the L.A. Daily News since 1989. He wouldn't say the movies have gotten worse in that time, but they do keep getting harder to love. Fortunately, he still loves them.

Join the Conversation

We invite you to use our commenting platform to engage in insightful conversations about issues in our community. Although we do not pre-screen comments, we reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable to us, and to disclose any information necessary to satisfy the law, regulation, or government request. We might permanently block any user who abuses these conditions.

If you see comments that you find offensive, please use the “Flag as Inappropriate” feature by hovering over the right side of the post, and pulling down on the arrow that appears. Or, contact our editors by emailing moderator@scng.com.